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Grain Comments: 03-13-2024

Good morning.

After being the upside leader Tuesday, soybeans are the downside leader on Wednesday, as ag markets are mostly lower in the overnight session. Choppy trade continues as soybean harvest in Brazil chugs along, while more moisture for the second corn crop is desired in the next 5 weeks; prevailing fundamental headlines remain. Corn futures are trading 1-2 cents lower, soybean futures are trading 10-12 cents lower, and the Chicago wheat market is down 3-4 cents. Products are mixed, soybean meal is down $5-6/ton, while soybean oil is up 30 points. Outside markets are mostly higher, crude oil futures are up around $1/bbl, the Dow Jones index is up 10 points, and the US$ index is down 10 points.

CONAB’s smaller estimate for Brazil’s soy crop caused a one-day rally, but the debate will be ongoing as to final crop size; there remains an 8.2 mmt gap between CONAB and USDA.

Both corn and soybeans will see technical resistance Wednesday in the form of the 50-day moving average, which is at 4.47 1/4 for May corn, and 12.03 for May soybeans.

March deliveries for Wednesday include 25 contracts of corn, 16 contracts of Chicago wheat, 15 contracts of soybeans, 52 contracts of meal, and 42 contracts of bean oil.

Today’s weekly ethanol production report is expected to show daily production in a range of 1.033 to 1.057 mil bbls, which would be slightly lower or unchanged from last week. Stocks are seen in a range of 26.088 to 26.351 mil bbls, which would be up slightly from last week.

The Ukrainian Grain Association announced combined 2024 grain and oilseed harvest was expected to reach 76.1 mmt’s, which would be roughly 6.5 mmt’s below last year.

API crude oil stocks, out Tuesday afternoon, showed US crude inventories dropped by 5.5 mil bbls last week, which was the first drop in 7 weeks. EIA will update their stocks figures Wednesday morning.

India announced vegetable oil imports fell to 974,852 tons in February, compared with 1.2 mil tons in January. Palm oil imports were down 285,159 tons in January, and soybean oil imports were down 15,923 tons.

Russian President Putin, in a wide-ranging interview with state media Tuesday, warned that Russia was technically prepared for nuclear war with the West. He also warned against the US sending troops into Ukraine, saying this would be seen as a significant escalation of the conflict.

Concern remains regarding dryness in North/Central Brazil over the coming two weeks. Rainfall looks to be just 40% of normal into the end of March, which is a worry for the second corn crop.

Argentina sees isolated pockets of excessive rainfall, which could cause flooding in the Northeast into Southern Brazil, but otherwise continues to have a generally favorable forecast.

The US Midwest saw scattered showers move through Tuesday night, with another round of potentially stronger storms set to move through Wednesday night into Thursday. Weekly storm chances look to continue for the East into the end of March.

Have a great day!

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